Widening Wage Gap: What ordinary South Africans earn compared to politicians and top business executives
South Africa is ranked as the world’s most unequal society and no more evident is this when gasping at the wage gap between ordinary citizens, politicians and top business executives.
A report by Statistics South Africa highlighted that the top 10% of the country's earners take home more than half of all wage income, while the bottom 50% earn less than 8%. This disparity is further exacerbated by gender, with women earning, on average, 30% less than their male counterparts.
The disparities in South African salaries have once again come under the spotlight, as recent data reveals a widening chasm between the country's top executives, politicians, and the average citizen.
Politicians' Pay Packets
The Minister of Cooperative Governance and Traditional Affairs (Cogta), Thembi Nkadimeng recently announced revised salary scales for mayors, speakers, and mayoral executive council members.
While the national government sets the upper salary limits for these officials, municipal managers' salaries are determined by individual councils based on their budget plans. The salary hikes for local government officials are set at 3.8% for 2023, according to a recently published Government Gazette.
For instance, an Executive Mayor under Grade 6 will earn R1,501,351 in 2023, up from R1,446,388 in 2022. In addition to their salaries, councillors receive allowances for car usage, out-of-pocket expenses, phone bills, and special risk cover, which includes insurance against loss or damage due to civil unrest.
On a national level, President Cyril Ramaphosa approved a 3% salary increase for all public office bearers for the 2022/23 period, despite some demanding a 7% hike.
Cabinet Ministers will now earn R2.58 million annually, up from R2.4 million, while ordinary members of parliament will take home R1.2 million per year.
In 2023, the president’s salary will increase from R4.2 million to R4.6m.
The deputy president will earn R4m in 2023.
Top Executives Raking It In
The earnings of CEOs from the 10 largest companies listed on the Johannesburg Stock Exchange (JSE) paint a different picture.
With a combined market capitalisation of R15.2 trillion, these companies offer their top executives salaries that dwarf those of most South Africans, according to a Business Tech report.
BHP Billiton's CEO, Mike Henry, stands out as the highest earner, with a staggering R265 million in 2022.
In contrast, FirstRand's CEO, Alan Pullinger, is the lowest-paid on the list, earning R48.29 million. These figures highlight the vast differences in remuneration even among the country's top earners.
The Average South African
Stats SA's Quarterly Employment Survey for Q1 2023 shows that the average monthly salary in South Africa is R25,304.
The Vulnerable and Elderly
The state pension, known as the Older Persons Grant, offers a glimpse into the financial challenges faced by the country's elderly. Recipients between 60 and 74-years-old will receive R2,080 from April 2023, with a slight increase to R2,090 in October. Those over 75 will get R2,100 from April, rising to R2,110 in October.
The vast disparities in earnings between South Africa's top executives, politicians, and the average citizen are stark.
While CEOs navigate the challenges of economic instability and political uncertainty, their earnings remain exponentially higher than those of ordinary South Africans and even the nation's top politicians.
Average Salaries
Politicians' Average Salary:
– Executive Mayor (Grade 6): R1,501,351
– Speaker, Executive Deputy Mayor, or Deputy Mayor (Grade 6): R1,212,520
– Member of the Executive Mayoral Committee, Whip, or Chairperson of a Subcouncil (Grade 6): R1,142,175
– Chairperson of Oversight Committee (Grade 6): R1,108,670
– Ministers: R2.58 million/year
– Deputy Ministers: R2.1 million/year
– Deputy President: R3 million/year
– Ordinary members of parliament: R1.2 million/year
– Leader of the main opposition: R1.7 million/year
– Other minority leaders: R1.43 million/year
Median Salary for Politicians: Approximately R1.43 million/year.
Business Executives' Average Salary
– BHP Billiton: R265 million (Mike Henry)
– Prosus N.V. and Naspers: R107.2 million (Bob van Dijk)
– British American Tobacco: R227.5 million (Michel Doukeris)
– Richemont: R167.7 million (Jerome Lambert)
– FirstRand: R48.29 million (Alan Pullinger)
– Standard Bank: R55.69 million (Sim Tshabalala)
– Anglo American: R104 million (Duncan Wanblad)
Median Salary for Business Executives: Approximately R107.2 million/year.
Average South African Salary:
R25,304/month or R303,648/year.
Social Grant (Older Persons Grant):
For recipients between 60 and 74 years old: R2080/month or R24,960/year.
For recipients over 75-years-old: R2,100/month or R25,200/year.
Comparison:
The median salary for politicians is roughly 4.7 times the average salary of a regular South African.
The median salary for business executives is a staggering 353 times the average salary of a regular South African.
The social grant for the elderly is only about 8% of the average South African's salary.
IOL News